Bill addresses risks of private state toll roads

Published 6:00 pm, Sunday, March 1, 2009

Sen. Robert Nichols, R-Jacksonville, believes he has found a solution regarding private toll roads that favors local entities and protects the state’s pocketbook and interests.

Two years after the Texas Senate approved a moratorium on most new privately financed toll road projects, Nichols co-authored Senate Bill 17, which addresses the concerns and fears that led to the suspension.

“There’s been a lot of work put into this bill to put a lot of protections in for the people,” Nichols said.

Nichols worked with multiple organizations and the Texas Department of Transportation to make sure “it works for everybody,” he said.

The bill, filed Monday, gives local authorities, such as the Montgomery County Tolling Authority, and TxDOT the option to develop projects before a private company. It also addresses private equity contracts, requiring a company to produce a pay schedule so the state is not bound to pay billions if the state is forced to terminate the contract early.

The bill also reins in non-compete clauses, so private companies cannot charge the state for loss of toll revenue if the state or federal government expands or builds any preplanned project that may compete with a toll road. Plus, the bill limits the non-compete clause to no longer than 30 years, instead of the usual 50 years, Nichols’ Press Secretary Alicia Pierce said.

Nichols is receiving positive feedback from state lawmakers and county leaders.

“I agree with privatizing toll roads - I don’t have a problem with that - but there needs to be some controls,” Precinct 3 Commissioner Ed Chance said.

Montgomery County Judge Alan B. Sadler, who heads the Montgomery County Tolling Authority, called SB 17 a commonsense measure since it makes all possible entities involved in toll road projects an underwriter in the feasibility of the projects.

“I support this bill in its entirety,” Sadler said. “There’s no doubt toll roads can be a risky venture. I do not plan to ever risk county money on toll roads; they should be paid for through revenue bonds or private investments. No county tax dollars should be put at risk.”

The bill is not the end-all for state road issues, Nichols said.

“One of the biggest issues is how are we going to fund our roads,” Nichols aid. “We don’t want them to all be toll roads.”

Senate Transportation Committee Chair John Carona, R-Dallas, who co-authored SB 17 with Nichols and three other senators, is filing a number of bills related to funding roads, Nichols said. One of the main goals is to redirect Fund 6, a fund dedicated for transportation because its collections come from transportation-related fees such as fuel taxes and vehicle registrations. However, over the years, much of the $1 billion collected annually through Fund 6 goes to projects unrelated to transportation.